aasifali007
Asif Darvesh
Organizational Theory redefined:
Crazy ways for crazy days:Significance of the title is till this point of time interms of mng orgn there was theory of orgn which said the best way to haMng arge complex orgn
Theory of bureucracy etc. Theory of Orgn predicts as orgn becomes large there will be more and more of centralization and units at lower level much of their discreetion
will be taken away.But in practise we see the orgn is mng growth contradictory to what theory predicts. So craziness is in fact that practise and understandig
predicted going particular way and heres Orgn that goes the other way. Thus mng in such a way that runs counter to known wisdom on how to run the orgn.
What makes crazy days is that product lifecycles are shrinking(No orgn can make product and hope to survive from that product for prolonged period of time)
since environment is hostile, competetive.Customized product demand by Customers. To respond to this challenges what is needed are Orgn that are highly felxible. Cannot
be run like stdd bureucracy. If you need large number of Mgr to run Orgn then this may be bad orgn->Professionals are not good enough. Good Orgn have
processes in place and doesnt need people to run them.Thereby enabling effective Orgn.
Logistics Company: The laine Group: Imagination:Opicon:
Concept of multijob where people moved across func with focus on creativity or Customer. Work environment more open->Flat structure. Stress on performance not on procedure
reduction of paper work, concept of mobile workplace. Boundaries are really not so tight. So company reinvented itself using these methodologies.
Simple job means highly specialized jobs, here they are going counter to known wisdom of simplification.
In terms of Calcutta Municipal there were 150 job categories and as per req in India you need min strngth of 7 people to form sperate orgn. In each was 7 employees and
there were thousands of Orgn. In 80's in each hall they would have clock. There was a category whose job was to set the clock to exact time for synchronization.
He requested helper and categories of helpers got created. This whole concept of specialization can get pushed to ridiculous levels. Thus orgn was run for its employees
not for serving people. It gets completely disconnected from whom its supposed to serve. Same tendencies operate in large orgn to a lesser degree. In opicon
as well there was a belief that we know the best thing for Consumer and as a consequence the orgn gets insulated from the environemtn and especially in competetive
environemtn the orgn will not be able to survive(Air India).Opicon acheived a turnaround by moving from mono job to multi job and created flatter orgn and finally
also there was elimination of paperwork.More focus on oral than written communication(This is danger with advent of technology, big reliance on written word).
Similar to moving files in bureucratic orgn.
Recruiting best talent and giving them lots of latitude interms of performance. Interms of Company policy it can be stressful for fresh talent. The process by which
whole thing operates in orgn when you join orgn as fresh entrant to the time you are given responsibility the time gap typically would be a month to year depending
on the level you join in.Process would be induction and orgn requires to motivate the employee with clear result for achievement.
Incase of Imagination inshort span of 6 months handling crucial responsibilities is a policy followed by orgn that depends on high quality talent and which wants to retain
Thus counter to belief where you take risk with fresh raw talent and many times the payoff if do good job of selecting right talent in orgn. CEO spends lot
of time in screening the candidates. Good indication is to check out when you are talking about fresh recruitment actually inducted in the orgn. In large orgn
handled by HR.
In average orgn when fresh recruitement process handled by HR. In Imagination CEO screens candidates and make decision on whom to and whom not to recruit. In large
orgn these decisions are highly routinized.
Many companies where before employment order issues fresh recruit is interviewed by the team. In orgn like Imagination, several levels where people are screened.
Recruitment of people are strategic critical function. HR only plays facilitating role. There is substantive interaction with the employees. Company like Interactive are
small, highly dependant on talented people, you invest a lot of management critical time having multiple rounds of management screening. Thus Companies are visiting back
and start interaction right from Year 3.
Laine Group: Time Management: Partnership. New trend that there is a close connect between orgn that provides svc and that receives svc and such close connect that
they are governed by partnership document and there is a lot if stake by one orgn in the success stake of other. One orgn is interested in welfare of other orgn and
this kind of partnership is structured in sharing of information, incentive is very sharp if targets are met for each other. New relactionship which is extremely
close partnership and open sharing of information: profits, customers etc, open book accounting. Data of cost structire , profit are normally under-wrap. But here
we are talking of very different kind of relationship.
Highlight the fact that the way they are organized is counter to established wisdom and ways. They are leading practise as far as concept of Orgn is concerned.
Effective Organizations: Followup with another video: Collin and Jerry What makes companies excellent.
Video Learnings:
Stanford:
Executive Edn program: >>Stanford breakfast briefings<<
Build to last: Successful strategies of visionary Company: Visionary leader only imp to degree that they built company that lasted long after.
Focus should be on Company that last far beyond that individual. We do not see a charismatic larger than life visionary leader. Help us build Company who believe
we are not visionary leader. Company and not so much the leader we have to think about.
Research method:Findings that run contradictory to principles on how business are learned. The credibility in findingd will be reinforced. Visionary leader at 3M:
We didnt know the CEO a very charismatic leader. Then Company must have something that allows the visionary and so we went back to the creator of the Company. How do we
identify the 3M's of the world. Surveys of 700 CEO and have their understanding on 5 visionary companies. Composed 1page letter(short ones) to CEO's. Response of 24% recvd.
Apple, Compaq(Young companies), Walmart and Sony(1940's based company).1.Selected Companies,2. Did historical analysis of these companies. What makes them special.
If you wanna know how and why winner of marathon won the race you need to go back. Training, food, rest would help the evaluation. 3. Comparision groups. That characteristic
was unique and not shared by other companies.18 Visionary Companies and 18 competing companies
AMEX, Boeing, Citi, IBM, J&J, Motorolla, Sony ; Walmart:
How did they perform during early days. So started looking at stock market price and the data set went back to 1926 and pulled out 3 portfolios, all mkt in general; comparision company
and competetive company. That $ invested in mkt(1926 to 1990) went from 1 to 450$; competetive 1 to 900; visionary companies 1 to 6356$.
Findings:
Deeply admired by a wide array of people in business world
Made significant contribution in environment in which they operate
Economically successful over period of time and done through multiple cycles of leadership(CEO's), multiple cycles of products, multiple industry cycles.
Clock telling perspective versus time building perspective: View leadership had to build a great company and they didnt focus the comany around their charisma. They revolved around developing
great companies.
Motorolla(Car radios) and Zenith(home radios) founded in 1920's. Motorolla CEO not hi-tech engineer. Focussed on developing management process, CEO office had 3 people,
structures. As these companies grew into late 1950's, something happened: both CEO's died within years of each other. From that period forward
Zenith still doing TV sets and worked on laptops but still not doing that good.
Motorolla worked on telephones and many other products.
High quality or low cost; Long term vs short term; autonomy to people or we control. Visionary worked on concept of and(short and long term profit, people autonomy and we control; high
quality and low cost. Important dimension that defined characteristic
Notion that 2 significant processes
1. Preserving the core ideology: Set of core values(3-6 fundamental values that dont change even when environment punished them for holding it). Process that serve to deserve them. Enuniciated core values and codified them eg J&J, HP;3M manifesto
J&J pulled tylenol off every shelf and 2500 people conduct massive campaign; invested in changing bottles(100mill$).Main orientation is core values not the bottom line.
2. Stimulating progress: Why orgn exist, what is the purpose(extended beyond making profit).Stimulating change, adaptability, creativity.
Preserve the core and changed everything thats not core to make themselves adapatable, responsive at same time keeping anchor on where they were going.
Ying Yang symbol Circle represents orgn; 2 represents Presernation of core and stimulating progress and one is change and one is not change and thus the symbol
represents how the companies hold them together.
Actual mechanism: 6 of them
1.Core ideology: Purpose beyond making profit.eg Merck: Preserve human life. Blinding flu from mosquitos in Africa
2.Tight cultures: Characteristic of cult shared by these companies: Sense of belonging; indoctrination; building peoples mindsets; brainwashed; initiative. eg Disney first 3 days
you go through course(indoctrination); teach what Disney is about., purpose(make people happy); identify products(Mickey, Donald). Hired by casting not personnel.
Dont fit these orgn unless they fit the cultures
3.CEO's almost always selected from within the Orgn who understand the Core well. 4 instances where CEO's selected outside the orgn then how do you get creativity if always
appointing people from inside. Good eg Jack Welch: GE. They do bring in change and also innovation
4.Promote change in progress. Big hairy adicious goal. Boeing another eg, coming out of Second World War, Boeing said we build jets and bet company on 707 and then again on 747
Big substantial goals; Jack Keneddy in 1960(Man on moon and back in a decade) and thats one way of stimulating change.
5. Do not rely on long term strategic plans. Tended to grow by increaments, lot of variation, creativity and whatever worked they kept. Stigma was not to try new things.
Constantly innovating and changing. Eg 3M: require 15% of time thinking on new ideas and cant be critisized for thinking and experimenting.
6.Sense of competing with self. We are the best , if we can beat ourself and never satisfied of what we can deliver. Eg Walmart: Ledger books so they have data on how they did
last year on this day, so constant improvement. Brand Mgmt structure, one brand competing against other brand in P&G.
7. These Orgn were very good at aligning themself to support the core ideology, core purpose, core values. So rewards systems reward people for being experimental
not punishes them. Rewards risk takers.
More laigned in Visionary companies than competetive companies. Dont have to be larger than life visionary leader. You can do a lot of these on your own.
Have any of these visionary companies merged with other companies: It doesnt works well since Visionary have tight cultures and they impress ideology on those
companies and in doing that distort the company attractiveness for which they were merged.
Over long period they always recover from mistakes. Values that you hold very strongly
Crazy ways for crazy days:Significance of the title is till this point of time interms of mng orgn there was theory of orgn which said the best way to haMng arge complex orgn
Theory of bureucracy etc. Theory of Orgn predicts as orgn becomes large there will be more and more of centralization and units at lower level much of their discreetion
will be taken away.But in practise we see the orgn is mng growth contradictory to what theory predicts. So craziness is in fact that practise and understandig
predicted going particular way and heres Orgn that goes the other way. Thus mng in such a way that runs counter to known wisdom on how to run the orgn.
What makes crazy days is that product lifecycles are shrinking(No orgn can make product and hope to survive from that product for prolonged period of time)
since environment is hostile, competetive.Customized product demand by Customers. To respond to this challenges what is needed are Orgn that are highly felxible. Cannot
be run like stdd bureucracy. If you need large number of Mgr to run Orgn then this may be bad orgn->Professionals are not good enough. Good Orgn have
processes in place and doesnt need people to run them.Thereby enabling effective Orgn.
Logistics Company: The laine Group: Imagination:Opicon:
Concept of multijob where people moved across func with focus on creativity or Customer. Work environment more open->Flat structure. Stress on performance not on procedure
reduction of paper work, concept of mobile workplace. Boundaries are really not so tight. So company reinvented itself using these methodologies.
Simple job means highly specialized jobs, here they are going counter to known wisdom of simplification.
In terms of Calcutta Municipal there were 150 job categories and as per req in India you need min strngth of 7 people to form sperate orgn. In each was 7 employees and
there were thousands of Orgn. In 80's in each hall they would have clock. There was a category whose job was to set the clock to exact time for synchronization.
He requested helper and categories of helpers got created. This whole concept of specialization can get pushed to ridiculous levels. Thus orgn was run for its employees
not for serving people. It gets completely disconnected from whom its supposed to serve. Same tendencies operate in large orgn to a lesser degree. In opicon
as well there was a belief that we know the best thing for Consumer and as a consequence the orgn gets insulated from the environemtn and especially in competetive
environemtn the orgn will not be able to survive(Air India).Opicon acheived a turnaround by moving from mono job to multi job and created flatter orgn and finally
also there was elimination of paperwork.More focus on oral than written communication(This is danger with advent of technology, big reliance on written word).
Similar to moving files in bureucratic orgn.
Recruiting best talent and giving them lots of latitude interms of performance. Interms of Company policy it can be stressful for fresh talent. The process by which
whole thing operates in orgn when you join orgn as fresh entrant to the time you are given responsibility the time gap typically would be a month to year depending
on the level you join in.Process would be induction and orgn requires to motivate the employee with clear result for achievement.
Incase of Imagination inshort span of 6 months handling crucial responsibilities is a policy followed by orgn that depends on high quality talent and which wants to retain
Thus counter to belief where you take risk with fresh raw talent and many times the payoff if do good job of selecting right talent in orgn. CEO spends lot
of time in screening the candidates. Good indication is to check out when you are talking about fresh recruitment actually inducted in the orgn. In large orgn
handled by HR.
In average orgn when fresh recruitement process handled by HR. In Imagination CEO screens candidates and make decision on whom to and whom not to recruit. In large
orgn these decisions are highly routinized.
Many companies where before employment order issues fresh recruit is interviewed by the team. In orgn like Imagination, several levels where people are screened.
Recruitment of people are strategic critical function. HR only plays facilitating role. There is substantive interaction with the employees. Company like Interactive are
small, highly dependant on talented people, you invest a lot of management critical time having multiple rounds of management screening. Thus Companies are visiting back
and start interaction right from Year 3.
Laine Group: Time Management: Partnership. New trend that there is a close connect between orgn that provides svc and that receives svc and such close connect that
they are governed by partnership document and there is a lot if stake by one orgn in the success stake of other. One orgn is interested in welfare of other orgn and
this kind of partnership is structured in sharing of information, incentive is very sharp if targets are met for each other. New relactionship which is extremely
close partnership and open sharing of information: profits, customers etc, open book accounting. Data of cost structire , profit are normally under-wrap. But here
we are talking of very different kind of relationship.
Highlight the fact that the way they are organized is counter to established wisdom and ways. They are leading practise as far as concept of Orgn is concerned.
Effective Organizations: Followup with another video: Collin and Jerry What makes companies excellent.
Video Learnings:
Stanford:
Executive Edn program: >>Stanford breakfast briefings<<
Build to last: Successful strategies of visionary Company: Visionary leader only imp to degree that they built company that lasted long after.
Focus should be on Company that last far beyond that individual. We do not see a charismatic larger than life visionary leader. Help us build Company who believe
we are not visionary leader. Company and not so much the leader we have to think about.
Research method:Findings that run contradictory to principles on how business are learned. The credibility in findingd will be reinforced. Visionary leader at 3M:
We didnt know the CEO a very charismatic leader. Then Company must have something that allows the visionary and so we went back to the creator of the Company. How do we
identify the 3M's of the world. Surveys of 700 CEO and have their understanding on 5 visionary companies. Composed 1page letter(short ones) to CEO's. Response of 24% recvd.
Apple, Compaq(Young companies), Walmart and Sony(1940's based company).1.Selected Companies,2. Did historical analysis of these companies. What makes them special.
If you wanna know how and why winner of marathon won the race you need to go back. Training, food, rest would help the evaluation. 3. Comparision groups. That characteristic
was unique and not shared by other companies.18 Visionary Companies and 18 competing companies
AMEX, Boeing, Citi, IBM, J&J, Motorolla, Sony ; Walmart:
How did they perform during early days. So started looking at stock market price and the data set went back to 1926 and pulled out 3 portfolios, all mkt in general; comparision company
and competetive company. That $ invested in mkt(1926 to 1990) went from 1 to 450$; competetive 1 to 900; visionary companies 1 to 6356$.
Findings:
Deeply admired by a wide array of people in business world
Made significant contribution in environment in which they operate
Economically successful over period of time and done through multiple cycles of leadership(CEO's), multiple cycles of products, multiple industry cycles.
Clock telling perspective versus time building perspective: View leadership had to build a great company and they didnt focus the comany around their charisma. They revolved around developing
great companies.
Motorolla(Car radios) and Zenith(home radios) founded in 1920's. Motorolla CEO not hi-tech engineer. Focussed on developing management process, CEO office had 3 people,
structures. As these companies grew into late 1950's, something happened: both CEO's died within years of each other. From that period forward
Zenith still doing TV sets and worked on laptops but still not doing that good.
Motorolla worked on telephones and many other products.
High quality or low cost; Long term vs short term; autonomy to people or we control. Visionary worked on concept of and(short and long term profit, people autonomy and we control; high
quality and low cost. Important dimension that defined characteristic
Notion that 2 significant processes
1. Preserving the core ideology: Set of core values(3-6 fundamental values that dont change even when environment punished them for holding it). Process that serve to deserve them. Enuniciated core values and codified them eg J&J, HP;3M manifesto
J&J pulled tylenol off every shelf and 2500 people conduct massive campaign; invested in changing bottles(100mill$).Main orientation is core values not the bottom line.
2. Stimulating progress: Why orgn exist, what is the purpose(extended beyond making profit).Stimulating change, adaptability, creativity.
Preserve the core and changed everything thats not core to make themselves adapatable, responsive at same time keeping anchor on where they were going.
Ying Yang symbol Circle represents orgn; 2 represents Presernation of core and stimulating progress and one is change and one is not change and thus the symbol
represents how the companies hold them together.
Actual mechanism: 6 of them
1.Core ideology: Purpose beyond making profit.eg Merck: Preserve human life. Blinding flu from mosquitos in Africa
2.Tight cultures: Characteristic of cult shared by these companies: Sense of belonging; indoctrination; building peoples mindsets; brainwashed; initiative. eg Disney first 3 days
you go through course(indoctrination); teach what Disney is about., purpose(make people happy); identify products(Mickey, Donald). Hired by casting not personnel.
Dont fit these orgn unless they fit the cultures
3.CEO's almost always selected from within the Orgn who understand the Core well. 4 instances where CEO's selected outside the orgn then how do you get creativity if always
appointing people from inside. Good eg Jack Welch: GE. They do bring in change and also innovation
4.Promote change in progress. Big hairy adicious goal. Boeing another eg, coming out of Second World War, Boeing said we build jets and bet company on 707 and then again on 747
Big substantial goals; Jack Keneddy in 1960(Man on moon and back in a decade) and thats one way of stimulating change.
5. Do not rely on long term strategic plans. Tended to grow by increaments, lot of variation, creativity and whatever worked they kept. Stigma was not to try new things.
Constantly innovating and changing. Eg 3M: require 15% of time thinking on new ideas and cant be critisized for thinking and experimenting.
6.Sense of competing with self. We are the best , if we can beat ourself and never satisfied of what we can deliver. Eg Walmart: Ledger books so they have data on how they did
last year on this day, so constant improvement. Brand Mgmt structure, one brand competing against other brand in P&G.
7. These Orgn were very good at aligning themself to support the core ideology, core purpose, core values. So rewards systems reward people for being experimental
not punishes them. Rewards risk takers.
More laigned in Visionary companies than competetive companies. Dont have to be larger than life visionary leader. You can do a lot of these on your own.
Have any of these visionary companies merged with other companies: It doesnt works well since Visionary have tight cultures and they impress ideology on those
companies and in doing that distort the company attractiveness for which they were merged.
Over long period they always recover from mistakes. Values that you hold very strongly